,,ii #aahth ,,congress #ast ,session ,s4 #afah ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,may #af1 #bjbc,mr4 ,van ,hollen 7for himself1 ,mr4 ,rubio1 ,ms4 ,baldwin1 ,mr4 ,young1 ,mrs4 ,shaheen1 and ,mr4 ,braun7 introduced the following bill2 which was read twice and referred to the ,committee on ,small ,business and ,entrepreneurship ,a ,,bill ,to amend the ,small ,business ,investment ,act of #aieh to establish an employee equity investment facility1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,employee ,equity ,investment ,act of #bjbc4 #b4 ,employee equity investment facility 7a7 ,definitions ,section #ajc of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #ffb7 is amended-- 7#a7 in paragraph 7#ai71 by striking and at the end2 7#b7 in paragraph 7#bj71 by striking the period at the end and inserting a semicolon2 and 7#c7 by adding at the end the following3 7#ba7 the term covered investment means1 with respect to an investment in a covered small business concern-- 7,a7 the provision of capital to finance the sale of an ownership interest of a covered small business concern1 including a covered small business concern created as a result of a corporate divestiture1 to an employee stock ownership plan or eligible worker-owned cooperative if such sale results in-- 7i7 the employee stock ownership plan or eligible worker-owned cooperative1 respectively1 holding a majority interest of the outstanding stock of the covered small business concern2 and 7ii7 with respect to such a sale to an employee stock ownership plan1 the appointment of an independent trustee for the transaction2 or 7,b7 the provision of capital to finance a covered small business concern if-- 7i7 an employee stock ownership plan or eligible worker-owned cooperative holds a majority interest of the outstanding stock of the covered small business concern1 prior to and immediately following the provision of capital2 and 7ii7 the provision of capital does not reduce the percentage of stock of the covered small business concern held by the employee stock ownership plan or eligible worker-owned cooperative 7as applicable71 excluding any synthetic equity2 7#bb7 the term covered small business concern-- 7,a7 means a small business concern2 and 7,b7 with respect to an employee equity investment company that is not a ,protege ,,eeic1 includes an entity that is not more than #cjj percent larger than the size standards established for categorizing a business concern as a small business concern under section #c7;a7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcb7;a772 7#bc7 the term eligible worker-owned cooperative has the meaning given that term in section #ajdb7;c7 of the ,internal ,revenue ,code of #aihf2 7#bd7 the term employee equity investment company means a small business investment company-- 7,a7 that identifies at the time of application for licensure under section #cja an intent to be licensed as an employee equity investment company2 and 7,b7 for which-- 7i7 not less than #ge percent of the total capital managed by the investment firm shall be invested in covered investments2 7ii7 not less than #ej percent of the total capital managed by the investment firm shall be invested in covered investments described in paragraph 7#ba77;,a72 7iii7 covered investment returns are obtained from debt1 synthetic equity1 or a combination thereof1 including returns obtained from cash interest1 payment-in-kind interest1 and stock warrants2 and 7iv7 any investment that is not a covered investment is an investment in a small business concern2 7#be7 the term employee stock ownership plan has the meaning given that term in section #dige7;e7 of the ,internal ,revenue ,code of #aihf2 7#bf7 the term independent trustee means a trustee that-- 7,a7 is in the profession of serving as a fiduciary for employee stock ownership plans2 7,b7 has never-- 7i7 performed services for or on behalf of any party selling an ownership interest in the covered small business concern to the employee stock ownership plan involved in the transaction the trustee is considering2 or 7ii7 been a director1 officer1 or employee of the covered small business concern2 7,c7 has not performed services for or on behalf of the covered small business concern at any time during the #e-year period ending on the date of execution of the transaction the trustee is considering1 unless such services solely consisted of acting as a fiduciary of an employee benefit plan 7including an employee stock ownership plan7 under the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #ajja et seq472 7,d7 has not performed services related to the transaction the trustee is considering1 for or on behalf of-- 7i7 the employee equity investment company that is preparing to or has already allocated capital to the covered small business2 or 7ii7 any other entity that is structuring or financing the transaction for any party other than the employee stock ownership plan2 and 7,e7 does not have a familial or corporate relationship 7such as a parent-subsidiary relationship7 to any person or entity described in subparagraph 7,b71 7,c71 or 7,d72 7#bg7 the term independent financial advisor means a financial or valuation advisor that-- 7,a7 is in the profession of serving as a financial or valuation advisor for transactions involving employee stock ownership plans2 7,b7 has never-- 7i7 performed services1 including a preliminary valuation1 for or on behalf of-- 7,i7 any party selling an ownership interest in the covered small business concern to the employee stock ownership plan involved in the transaction the advisor is evaluating2 or 7,,ii7 the covered small business concern1 unless the services were provided solely to an existing employee stock ownership plan sponsored by the covered small business concern2 or 7ii7 been a director1 officer1 or employee of the covered small business concern2 7,c7 has not performed services related to the transaction the advisor is evaluating1 including a preliminary valuation1 for or on behalf of-- 7i7 the employee equity investment company that is preparing to or has already allocated capital to the covered small business2 or 7ii7 any other entity that is structuring or financing the transaction for any party other than the employee stock ownership plan2 and 7,d7 does not have a familial or corporate relationship 7such as a parent-subsidiary relationship7 to any of person or entity described in subparagraph 7,b7 or 7,c72 7#bh7 the term non-,,eeic company means a small business investment company that-- 7,a7 is licensed under section #cja2 7,b7 is selected to receive leverage from the facility established under section #cba2 and 7,c7 is not an employee equity investment company2 7#bi7 the term outstanding stock means shares of stock1 including synthetic equity2 7#cj7 the term ,protege ,,eeic means an entity licensed under section #cja as an employee equity investment company and selected in accordance with section #cbb7;c7-- 7,a7 for which the managers of the firm have a documented record of successful business experience2 and 7,b7 that has an investment track record that does not meet the requirements to be licensed under section #cja2 and 7#ca7 the term synthetic equity has the meaning given that term in section #dji7p77#f7 of the ,internal ,revenue ,code of #aihf4 4 7b7 ,employee equity investment facility ,part ,a of title ,,iii of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #fha et seq47 is amended by adding at the end the following3 #cba4 ,employee equity investment facility 7a7 ,definition of facility ,in this section1 the term facility means the facility established under subsection 7b74 7b7 ,establishment ,the ,administrator1 acting through the ,associate ,administrator of the ,office of ,investment and ,innovation of the ,administration1 shall establish and carry out a facility to provide leverage to licensed employee equity investment companies and non-,,eeic companies for the purpose of encouraging covered investments4 7c7 ,application 7#a7 ,in general ,an investment firm desiring to participate in the facility shall submit to the ,administrator an application-- 7,a7 to be licensed to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic72 or 7,b7 to be selected to participate as a non-,,eeic company4 7#b7 ,rolling basis ,the ,administrator shall accept applications under paragraph 7#a7 on a rolling basis4 7#c7 ,electronic submissions ,the ,administrator shall allow an applicant under this section to electronically submit any document required by this section and to provide an electronic signature for any signature that is required on such a document4 7#d7 ,application process ,an investment firm shall identify an intent to be licensed as an employee equity investment company at the time the investment firm applies to be licensed as a small business investment company under section #cja4 7d7 ,provisional approval ,the ,administrator may provide provisional approval for a license to participate in the facility as an employee equity investment company for a period not to exceed #a year to an investment firm submitting an application under subsection 7c7-- 7#a7 that does not meet the minimum private capital requirements under section #cjb necessary for licensing under section #cja at the time of application2 7#b7 that states an intent to more effectively raise capital commitments in private markets with a license2 and 7#c7 that states an intent to more precisely request the desired amount of leverage contingent on securing capital from private market investors4 7e7 ,combined leverage ,the ,administrator may not provide leverage to employee equity investment companies and non-,,eeic companies under the facility in a total amount that is more than #e1jjj1jjj1jjj for a fiscal year4 ,not more than #bj percent of such total amount may be provided to non-,,eeic companies4 7f7 ,transaction requirements 7#a7 ,in general ,with respect to a covered investment described in section #ajc7ba77;,a7 involving a sale to an employee stock ownership plan1 an independent trustee for the employee stock ownership plan shall be appointed before the execution of the covered investment for a period of time that is sufficient for the independent trustee to fully evaluate the proposed transaction4 7#b7 ,fairness opinion ,an independent trustee appointed under paragraph 7#a7 shall obtain a fairness opinion on the proposed covered investment from an independent financial advisor1 which shall evaluate whether the price1 terms1 and cost of financing of the proposed covered investment are financially fair to the employee stock ownership plan4 7g7 ,prohibitions 7#a7 ,financing 7,a7 ,in general ,an employee of a covered small business concern may not provide personal financing of any kind for a covered investment1 including through a wage concession or rollover of a retirement plan4 7,b7 ,exceptions ,subparagraph 7,a7 shall not apply to-- 7i7 financing provided by an employee for the sale of an ownership interest held by the employee in a covered small business concern2 or 7ii7 employee capital contributions or membership fees paid by members of an eligible worker-owned cooperative1 if such amounts are reasonable and customary and not used for the purchase of the covered small business concern4 7#b7 ,control ,an employee equity investment company or non-,,eeic company shall not exercise control over a covered small business concern in which the employee equity investment company or non-,,eeic company1 respectively1 has made a covered investment4 7h7 ,employee allocations ,with respect to a covered investment described in section #ajc7ba77;,a7 made by an employee equity investment company that involves an employee stock ownership plan1 the employee stock ownership plan shall include a requirement that in the event of a sale to a third party of the covered small business concern in which the covered investment is made1 the proceeds that the employee stock ownership plan receives from the sale shall be distributed as though all shares of stock held by the employee stock ownership plan prior to the sale were fully allocated4 7i7 ,recirculation of shares 7#a7 ,share count ,with respect to a covered investment described in section #ajc7ba77;,a7 made by an employee equity investment company that involves an employee stock ownership plan1 the number of shares held by the employee stock ownership plan on the final date of each plan year shall not be less than the number of shares held by the employee stock ownership plan on the execution date of the covered investment4 7#b7 ,limitation ,the requirements under paragraph 7#a7 shall apply only with respect to the period during which the employee equity investment company has an interest in the covered small business concern4 7#c7 ,exception ,the requirement under paragraph 7#a7 may be waived by the independent trustee for the applicable employee stock ownership plan4 7j7 ,independent trustees ,with respect to a covered investment described in section #ajc7ba77;,a7 made by an employee equity investment company that involves an employee stock ownership plan1 the employee stock ownership plan shall have an independent trustee during the period that the employee equity investment company has an interest in the covered small business concern4 7k7 ,smaller enterprises 7#a7 ,in general ,except as provided in paragraph 7#b71 section #cjc7;d7 shall not apply to employee equity investment companies4 7#b7 ,protegee ,e,e,i,cs ,section #cjc7;d7 shall apply to a ,protege ,,eeic4 7l7 ,procedures related to a sale of a covered small business concern 7#a7 ,in general ,subject to paragraph 7#b71 an employee equity investment company shall require as a condition of making a covered investment described in section #ajc7ba77;,a7 involving an employee stock ownership plan that-- 7,a7 before any stock sale or the execution of any corporate matter listed in section #dji7;e77#c7 of the ,internal ,revenue ,code of #aihf1 the employee stock ownership plan shall-- 7i7 appoint an independent trustee for the transaction2 and 7ii7 require that the independent trustee obtain a fairness opinion from an independent financial advisor1 which shall evaluate whether the price1 terms1 and cost of financing of the proposed covered investment are financially fair to the employee stock ownership plan2 and 7,b7 the employee stock ownership plan requires that-- 7i7 in addition to the corporate matters listed in section #dji7;e77#c7 of the ,internal ,revenue ,code of #aihf1 each participant or beneficiary in the employee stock ownership plan is entitled to direct the employee stock ownership plan as to the manner in which voting rights under securities of the employer which are allocated to the account of such participant or beneficiary are to be exercised with respect to the approval or disapproval of any stock sale2 7ii7 the requirements of section #dji7;e77#c7 of the ,internal ,revenue ,code of #aihf and clause 7i7 of this subparagraph shall be met using the procedures described in section #dji7;e77#e7 of the ,internal ,revenue ,code of #aihf2 7iii7 unless the parties agree otherwise1 with respect to unallocated shares1 the independent trustee shall be directed to vote or tender such unallocated shares in the same proportion as allocated shares for which the independent trustee has received voting or tender instructions from participants in the employee stock ownership plan2 and 7iv7 with respect to allocated shares that the independent trustee does not receive voting or tender instructions from participants in the employee stock ownership plan1 the independent trustee shall have voting discretion over such shares4 7#b7 ,voting discretion ,nothing in paragraph 7#a77;,b7 shall limit the ability of an independent trustee to exercise voting discretion in accordance with the fiduciary obligations of the independent trustee under the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #ajja et seq474 7#c7 ,limitation ,the requirements under paragraph 7#a7 shall apply only with respect to the period during which the employee equity investment company has an interest in the covered small business concern4 7m7 ,reports ,in addition to the reporting requirements in #caj7;b71 each employee equity investment company 7including each ,protege ,,eeic licensed to operate as an employee equity investment company7 and each non-,,eeic company that has outstanding leverage received from the facility shall submit to the ,administrator an annual report1 which shall include1 for the year covered by the report1 the following information1 disaggregated by covered investments made under subparagraph 7,a7 and 7,b7 of section #ajc7ba73 7#a7 ,whether the covered investment was made with respect to an employee stock ownership plan or eligible worker-owned cooperative4 7#b7 ,for an employee stock ownership plan-- 7,a7 the effective date of the plan2 7,b7 the number of active plan participants2 7,c7 the number of employees of the covered small business concern for which the employee stock ownership plan is established2 7,d7 the total value of employer securities1 as determined by an independent appraiser hired by the independent trustee of the employee stock ownership plan2 7,e7 the total plan assets2 7,f7 the total contributions during the plan year2 7,g7 the total distributions during the plan year2 7,h7 the median account asset balance2 and 7,i7 demographic information of plan participants1 disaggregated by race1 gender1 and ,state4 7#c7 ,for an eligible worker-owned cooperative-- 7,a7 the number of member-owners2 7,b7 the number of employees of the covered small business concern for which the eligible worker-owned cooperative is established2 7,c7 the total value of employer securities2 7,d7 the aggregate assets of all membership accounts of the cooperative2 7,e7 the median membership account balance2 and 7,f7 demographic information of membership base1 disaggregated by race1 gender1 and ,state4 7n7 ,implementation milestones 7#a7 ,in general ,not later than #ahj days after the date of enactment of this section1 the ,administrator shall begin accepting applications to be licensed to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic74 7#b7 ,exclusion of leverage ,not later than #a year after the date of enactment of this section1 the ,administrator shall begin excluding from the calculation of outstanding leverage1 as described in section #cjc7;b77#b77;,f71 covered investments described in clause 7iii7 of such section4 7#c7 ,license timeline ,not later than #a year after the date of enactment of this section1 the ,administrator shall approve the first tranche of licenses to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic7 with respect to applicants that satisfy the applicable eligibility criteria4 7o7 ,sunset 7#a7 ,definition ,in this subsection1 the term sunset date means the first day of the twentieth calendar year that begins after the date on which the ,administrator approves the first license to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic74 7#b7 ,termination of authority ,on and after the sunset date1 the ,administrator may not license an entity to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic7 or select an entity to participate in the facility as a non-,,eeic company4 7#c7 ,continued participation by existing entities ,nothing in paragraph 7#b7 shall be construed to prohibit-- 7,a7 an employee equity investment company from continuing to draw leverage on and after the sunset date that was committed to the entity through the facility before the sunset date2 or 7,b7 a non-,,eeic company from continuing to receive an exclusion in the calculation of outstanding leverage by the ,administrator1 as described in section #cjc7;b77#b77;,f71 for covered investments described in clause 7iii7 of such section made to a covered small business before the sunset date4 7#d7 ,application ,the ,administrator shall not consider paragraph 7#b7 as a factor in the decision to license an entity to participate in the facility as an employee equity investment company 7including as a ,protege ,,eeic7 or to select an entity to participate in the facility as a non-,,eeic company before the sunset date4 4 7c7 ,employee equity investment company procedures ,title ,,iii of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #fha et seq47 is amended-- 7#a7 in section #cja7;c7 7#ae ,u4,s4,c4 #fha7;c771 by striking paragraph 7#c7 and inserting the following3 7#c7 ,matters considered 7,a7 ,in general ,in reviewing and processing any application under this subsection1 the ,administrator-- 7i7 shall determine whether-- 7,i7 the applicant meets the requirements of subsections 7a7 and 7c7 of section #cjb2 and 7,,ii7 the management of the applicant is qualified and has the knowledge1 experience1 and capability necessary to comply with this ,act2 7ii7 shall take into consideration-- 7,i7 the need for and availability of financing for small business concerns in the geographic area in which the applicant is to commence business2 7,,ii7 the general business reputation of the owners and management of the applicant2 and 7,,iii7 the probability of successful operations of the applicant1 including adequate profitability and financial soundness2 7iii7 shall not take into consideration any projected shortage or unavailability of leverage2 and 7iv7 shall give first priority to an applicant that is located in an underlicensed ,state with below median financing1 as determined by the ,administrator4 7,b7 ,additional matters considered for employee equity investment companies 7i7 ,investment track record ,except as provided in clause 7ii71 an applicant for a license to operate as an employee equity investment company shall submit to the ,administrator proof that the managers of the applicant have a track record of managing investments1 including structured investments1 realized or unrealized1 in an employee stock ownership plan or eligible worker-owned cooperative4 7ii7 ,advisory requirement ,an applicant that does not have an investment track record described in clause 7i7 or that is a ,protege ,,eeic shall submit to the ,administrator evidence that the applicant has retained or will retain a legal1 accounting1 or financial advisory firm with at least #e years of experience in structuring employee stock ownership plans or eligible worker-owned cooperatives4 7iii7 ,limitation ,the ,administrator may not reject an applicant for a license to operate as an employee equity investment company solely because the applicant lacks a sufficient track record in realized investments if the applicant demonstrates an otherwise successful investment track record that includes unrealized covered investments4 2 and 7#b7 in section #cjc7;b77#b7 7#ae ,u4,s4,c4 #fhc7;b77#b77-- 7,a7 in subparagraph 7,a71 in the matter preceding clause 7i71 by striking ,the maximum and inserting ,except as provided otherwise in this paragraph1 the maximum2 and 7,b7 by adding at the end the following-- 7,e7 ,employee equity investment companies 7i7 ,in general ,except as provided in subparagraph 7,g71 the maximum amount of outstanding leverage made available to any #a employee equity investment company may not exceed the lesser of-- 7,i7 #ajj percent of the private capital of such company2 or 7,,ii7 #cej1jjj1jjj4 7ii7 ,multiple licenses under common control ,the maximum amount of outstanding leverage made available to #b or more employee equity investment companies that are commonly controlled 7as determined by the ,administrator7 and not under capital impairment may not exceed #gjj1jjj1jjj4 7,f7 ,non-,,eeic company employee ownership investments 7i7 ,in general ,a non-,,eeic company may access leverage from the facility established under section #cba in addition to any leverage such non-,,eeic company is otherwise eligible to receive solely for the purpose described in clause 7ii7 and subject to the limitation under clause 7iv74 7ii7 ,purpose ,the purpose described in this clause is for the purpose of making covered investments described in section #ajc7ba77;,b7 7excluding synthetic equity74 7iii7 ,outstanding leverage ,subject to the limitation under clause 7iv71 in calculating the outstanding leverage of a non-,,eeic company for purposes of subparagraphs 7,a77ii7 and 7,b71 the ,administrator shall exclude the amount of leverage outstanding to covered small business concerns for a covered investment described in section #ajc7ba77;,b7 7excluding synthetic equity7 made by such non-,,eeic company4 7iv7 ,limitation ,the amount of leverage provided under clause 7i7 that is excluded under clause 7iii7 may not exceed #ej1jjj1jjj4 7,g7 ,protege ,e,e,i,cs ,the maximum amount of outstanding leverage made available under the facility established under section #cba to any #a ,protege ,,eeic may not to exceed the lesser of-- 7i7 #ajj percent of the private capital of the ,protege ,,eeic2 or 7ii7 #ajj1jjj1jjj4 4 7d7 ,conforming amendment ,section #cjh7;g7 of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #fhg7;g77 is amended by adding at the end the following3 7#d7 ,in its annual report for the year ending on ,december #ca1 #bjbc1 and in each succeeding annual report made pursuant to section #aj7;a7 of the ,small ,business ,act1 the ,administration shall include full and detailed aggregate data regarding-- 7,a7 employee stock ownership plans created by an employee equity investment company1 including-- 7i7 the total number of active plan participants2 7ii7 the total number of employees of the covered small business concerns with such employee stock ownership plans2 7iii7 the total value of employer securities1 as determined by the independent appraisers hired by the independent trustee of each employee stock ownership plan2 7iv7 the total plan assets2 7v7 the total contributions during the plan year2 7vi7 the total distributions during the plan year2 7vii7 the median account asset balance2 and 7viii7 demographic information of plan participants1 disaggregated by race1 gender1 ,state2 7,b7 eligible worker-owned cooperatives created by employee equity investment companies1 including-- 7i7 the number of member-owners2 7ii7 the total number of employees of the covered small business concern with such eligible worker-owned cooperatives2 7iii7 the total value of employer securities2 7iv7 the assets of all membership accounts2 7v7 the median membership account balance2 and 7vi7 demographic information of membership base1 disaggregated by race1 gender1 and ,state2 and 7,c7 non-,,eeic companies that received leverage from the facility1 including-- 7i7 the total amount of such leverage excluded by the ,administrator pursuant to section #cba7;e77#c77;,c72 7ii7 the number of employee stock ownership plans and eligible worker-owned cooperatives that received capital from a non-,,eeic company during the year covered by the report2 and 7iii7 the geographic location of each employee stock ownership plan and eligible worker-owned cooperative described in clause 7ii74 4 #c4 ,protege ,,eeic program ,part ,a of title ,,iii of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #fha et seq471 as amended by section #b1 is further amended by adding at the end the following3 #cbb4 ,protege ,,eeic program 7a7 ,establishment ,the ,administrator shall establish a program to be known as the ,protege ,,eeic ,program under which a manager with substantial experience in operating small business investment companies may enter into a written agreement approved by the ,administrator to provide guidance and assistance to a ,protege ,,eeic with respect to-- 7#a7 applying for a license for the ,protege ,,eeic to operate as an employee equity investment company2 and 7#b7 management of the employee equity investment company after licensure4 7b7 ,application ,after entering into a written agreement described in subsection 7a71 the ,protege ,,eeic shall apply for a license under section #cja4 7c7 ,selection ,the ,administrator may grant a license to a ,protege ,,eeic to operate as an employee equity investment company under section #cja based on the investment track record of one or more of the managers that have entered into a written agreement described in subsection 7a7 with the applicant ,protege ,,eeic4 7d7 ,requirements for managers ,if a manager enters into a written agreement described under subsection 7a7-- 7#a7 the manager may hold a minority financial interest in the employee equity investment company that is to be managed by the ,protege ,,eeic2 7#b7 the otherwise applicable maximum amount of outstanding leverage that may be made available to any one licensed company of the manager under section #cjc7;b77#b77;,a7 shall be increased by #ag1ejj1jjj2 and 7#c7 the otherwise applicable maximum amount of outstanding leverage that may be made available to any two or more licensed companies that are commonly controlled by the manager under section #cjc7;b77#b77;,b7 shall be increased by #ce1jjj1jjj4 4 #d4 ,office of ,employee ,ownership ,part ,a of title ,,iii of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #fha et4 seq471 as amended by section #c1 is further amended by adding at the end the following3 #cbc4 ,office of ,employee ,ownership 7a7 ,establishment ,there is established in the ,administration an ,office of ,employee ,ownership 7in this section referred to as the ,office7 which shall be responsible for-- 7#a7 developing expertise in employee stock ownership plans and eligible worker-owned cooperatives2 and 7#b7 assisting small business concerns in processes relating to a sale of such concerns to an employee stock ownership plan or eligible worker-owned cooperative4 7b7 ,duties ,the ,office shall-- 7#a7 provide outreach and educational materials to small business investment companies about the facility established under section #cba2 7#b7 maintain and publish a list of legal1 accounting1 or financial advisory firms with at least #e years of experience in structuring employee stock ownership plans or eligible worker-owned cooperatives2 7#c7 establish a ,small ,business ,employee ,ownership and ,cooperatives ,promotion ,program to offer technical assistance and training to employee-owned business concerns 7as defined in section #ba7;c77#c77,u7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fdh7;c77#c77,u77 on the transition to employee ownership2 7#d7 coordinate with small business development centers on implementing the requirements relating to employee-owned business concerns under section #ba7;c77#c7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fdh7;c77#c772 and 7#e7 coordinate with leaders in the field1 as determined by the ,administrator1 to develop outreach and educational materials on employee ownership in multiple languages4 4 #e4 ,modifying unconditional ownership and control requirements for certain employee-owned small business concerns 7a7 ,report on ownership and control through an employee stock ownership plan or eligible worker-,owned cooperative relating to set-,aside procurement 7#a7 ,definitions ,in this subsection-- 7,a7 the term ,administrator means the ,administrator of the ,small ,business ,administration2 7,b7 the term eligible worker-owned cooperative has the meaning given that term in section #ajdb7;c7 of the ,internal ,revenue ,code of #aihf2 and 7,c7 the term employee stock ownership plan has the meaning given that term in section #dige7;e7 of the ,internal ,revenue ,code of #aihf4 7#b7 ,sense of ,congress ,it is the sense of ,congress that-- 7,a7 employee stock ownership plans and eligible worker-owned cooperatives have unique ownership structures that create barriers to accessing set-aside procurement programs due to unconditional ownership and control requirements2 and 7,b7 the ownership structures of an employee stock ownership plan or an eligible worker-owned cooperative should not prevent an otherwise eligible entity from accessing set-aside procurement programs4 7#c7 ,study and report 7,a7 ,study ,the ,administrator1 in coordination with stakeholders1 including women-owned small business third-party certifiers and relevant ,federal agencies1 shall study and recommend alternatives to unconditional ownership and control requirements for employee stock ownership plans and eligible worker-owned cooperatives that would enable access to set-aside procurement programs4 7,b7 ,report ,not later than #ahj days after the date of enactment of this ,act1 the ,administrator shall submit to ,congress the recommendations developed under subparagraph 7,a7 and a plan to implement the recommendations for all set-aside procurement programs1 including identifying any applicable statutory changes necessary to implement such recommendations4 7b7 ,rulemaking ,not later than #ahj days after the submission of the report required under subsection 7a77#c77;,b71 the ,administrator of the ,small ,business ,administration shall issue or revise any applicable rules to carry out the recommendations formed in the report4 7c7 ,grace period 7#a7 ,small business concerns owned and controlled by socially and economically disadvantaged individuals ,section #h7;a7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcg7;a77 is amended by adding at the end the following3 7#bb7 ,concerns owned by employee stock ownership plans or eligible worker-owned cooperatives 7,a7 ,in general ,for the purposes of determining ownership and control of a concern under this subsection for award of a contract through a competition restricted to small business concerns owned and controlled by socially and economically disadvantaged individuals1 any interest in such concern held by an employee stock ownership plan or an eligible worker-owned cooperative shall be treated in the same manner as an interest held by the socially and economically disadvantaged individuals upon whom eligibility is based if-- 7i7 such concern was a socially and economically disadvantaged small business concern prior to the sale to an employee stock ownership plan or an eligible worker-owned cooperative2 and 7ii7 the chief corporate officer and a majority of the board of directors of such concern are socially and economically disadvantaged individuals4 7,b7 ,applicability ,the requirements of subparagraph 7,a7 shall apply for the #b-year period beginning on the date on which the majority of the stock of such concern was acquired by an employee stock ownership plan or eligible worker-owned cooperative4 4 7d7 ,small business concerns owned and controlled by women ,section #h7m7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcg7m77 is amended by adding at the end the following3 7#i7 ,concerns owned by employee stock ownership plans or eligible worker-owned cooperatives 7,a7 ,in general ,notwithstanding any other provision of law1 for the purposes of determining ownership and control of a concern under this subsection for award of a contract through a competition restricted to small business concerns owned and controlled by women1 any interest in such concern held by an employee stock ownership plan or an eligible worker-owned cooperative1 shall be treated in the same manner as an interest held by the women upon whom eligibility is based if-- 7i7 such concern was a small business concern owned and controlled by women prior to the sale to an employee stock ownership plan or an eligible worker-owned cooperative2 and 7ii7 the chief corporate officer and a majority of the board of directors of such concern are women4 7,b7 ,applicability ,the requirements of subparagraph 7,a7 shall apply for the #b-year period beginning on the date on which the majority of the stock of such concern was acquired by an employee stock ownership plan or eligible worker-owned cooperative4 4 7e7 ,small business concerns owned and controlled by service-,disabled veterans ,section #cf of the ,small ,business ,act 7#ae ,u4,s4,c4 #feg;f7 by adding at the end the following3 7j7 ,concerns owned by employee stock ownership plans or eligible worker-,owned cooperatives 7#a7 ,in general ,notwithstanding any other provision of law1 for the purposes of determining ownership and control of a concern under this section for award of a contract through a competition restricted to small business concerns owned and controlled by service-disabled veterans1 any interest in such concern held by an employee stock ownership plan or an eligible worker-owned cooperative1 shall be treated in the same manner as an interest held by the service-disabled veterans upon whom eligibility is based if-- 7,a7 such concern was a small business concern owned and controlled by service-disabled veterans prior to the sale to an employee stock ownership plan or an eligible worker-owned cooperative2 and 7,b7 the chief corporate officer and a majority of the board of directors of such concern are service-disabled veterans4 7#b7 ,applicability ,the requirements of paragraph 7#a7 shall apply for the #b-year period beginning on the date on which the majority of the stock of such concern was acquired by an employee stock ownership plan or eligible worker-owned cooperative4 4 7f7 ,definitions ,section #c of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcb7 is amended by adding at the end the following3 7gg7 ,employee stock ownership plan ,in this ,act1 the term employee stock ownership plan has the meaning given that term in section #dige7;e77#g7 of the ,internal ,revenue ,code of #aihf 7#bf ,u4,s4,c4 #dige7;e77#g774 7hh7 ,eligible worker-,owned cooperative ,in this ,act1 the term eligible worker-owned cooperative has the meaning given that term in section #ajdb7;c7 of the ,internal ,revenue ,code of #aihf4 4